Autumn Statement: all review and no action for business rates

3 December 2014

James Thompson, head of business rates at Deloitte Real Estate, comments on the announcement of the timetable for the review of the future structure of business rates.

“The government will publish the preliminary findings of their review of Business Rates Administration and a discussion document on Rates avoidance this month, and a review of the future structure of business rates to report by the 2016 Budget. This review has been long promised and at last we have a firm timetable although the Government has already said that this will be fiscally neutral.

“The retail rate reduction for shops with rateable values up to £50,000 will increase by only £500 from £1,000 to £1,500 next year. This means that shops receiving this benefit will see their rates bills either falling slightly at rateable values £45,000 or falling by over 11% at £10,000 rateable values.

“The increase in the multiplier will again be capped at 2% next year, all businesses would have been expecting this to rise by 2.3% in line with the Retail Price Index (RPI). This will amount to a mere 0.3% saving in bills.

“The Government has acted to prevent backdating of changes to rateable values before 01 April 2015. These will only be available on ratepayer appeals lodged before this date and on changes to Rateable Values made by the Valuation Office before April 2016.

“This will effectively close the 2010 rating list for the period to 2015 as if the revaluation had not been postponed. It seeks to avoid a rush of appeals just before the revaluation but will bring this forward to March 2015. Businesses that have not yet appealed against their rateable values will have to do so by March 2015 or risk missing out on up to five years of backdated savings.

“The extension of the small business relief scheme for another year is not a surprise.”

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